FRANCE –Emmanuel Faber, Chief Executive Officer (CEO) and President of the French dairy multinational Danone, will step down from his role as CEO after the company’s board voted to separate the chairman and CEO roles.
A statement from the dairy giant stated that Faber will stay on in his current positions at Danone until a new CEO is found and then become non-executive chairman.
The maker of Oikos dairy yogurt has been under fire by several activist investors in recent months who have called for changes in leadership amid a slumping stock price and questions over the company’s strategy.
“The underperformance of Danone’s share price has been driven, in our view, by a combination of poor operational track record and questionable capital allocation choices,” Bluebell wrote in a November letter to Danone’s lead independent director, Michel Landel.
Reuters reported Monday that a replacement for Faber could move quickly, with up to eight names of potential candidates already circulating among board members.
To refocus the company on growth, a number of initiatives have been implemented by the French dairy under Faber’s watch.
These include human resource restructuring that includes cutting the global workforce by 2% and a strategic review of its portfolio of brands, SKUs and assets.
The French company also plans to sell its stake in China Mengniu Dairy, which has a market value of more than US$2 billion, later this year.
The majority of proceeds from any future sale would be returned to shareholders through a share buyback programme.
These actions have however, not been entirely convincing and activists would argue that separating the CEO and chairman role would bring more oversight to the chief executive’s performance and increase the individual’s accountability.
Danone invests €12m to expand plant-based production at Spanish site
As the succession struggle continues, the Spanish unit of the French dairy announced a €12m (US$14.41 million) investment in a new plant-based production line at its Parets del Vallès factory.
The new line is dedicated exclusively to the manufacture of coconut and oat-based products under the company’s Alpro, Activia and Oikos brands for both local and international markets.
Upon commissioning, the facility will become Danone’s first hybrid factory that produces both dairy yogurts and plant-based alternatives.
The investment forms part of Danone’s commitment to reinvest itself and become a “local-first company”, as it continues to strengthen its plant-based business and offer more and better alternatives.
Earlier this month, the company agreed to acquire Earth Island, maker of the dairy-free Follow Your Heart range.
“Our commitment is bringing health through nutrition and hydration to as many people as possible. And we do this by driving the food revolution with innovation as the main force of transformation, both in our products and in our operations,” said Paolo Tafuri, CEO of Danone Spain.
Danone says the investment will result in 12 new positions, joining the current 181 employees at the 52,000 square-metre facility.
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